Prime Minister Anthony Albanese said he will give "strong consideration" to intervening in the energy sector to drive down surging power prices, but insists any targeted cost-of-living support for struggling Australians would be "counter-productive".
It comes as the Opposition Leader Peter Dutton describes the cost-of-living impact of Labor's first budget as "grim" and that people on fixed incomes such as pensioners are "really, really copping it".
The budget papers forecast a "sharp rise" in electricity prices to be 56 per cent higher over the next two years, with power bills expected to go up by 20 per cent this year and then 30 per cent the year after.
The Albanese government's plan is to boost productivity and participation through a $7.5 billion cost-of-living relief package, including cheaper medicines, a staggered introduction of an expanded paid parental leave scheme and the new housing accord which has aspirations to build a million affordable homes.
Mr Dutton said the government has failed to address rising cost of living in the budget and the revelations of the sharp power price hike will hurt many families.
"The government said only six months ago that families would see a $275 reduction - now they are told [it is] a 56 per cent increase," he told the ABC.
"People on fixed incomes, pensioners, they are really, really copping it in this budget and it is a grim budget."
Treasurer Jim Chalmers on Tuesday revealed the government would consider "regulatory interventions" and the Prime Minister on Wednesday indicated that the Australian Competition and Consumer Commission (ACCC) will likely have a strengthened further role.
"It means regulatory engagement, intervention into the market, which is something that we will give strong consideration to," Mr Albanese told the ABC's RN Breakfast program.
"We'll be taking the advice of the appropriate departments about an appropriate intervention. We understand the pressures that are on here."
He said the ACCC would be on further look out for price gouging in light of international circumstances.
"There is a global spike in energy prices directly resulted from the Russian invasion of Ukraine," he said. "This is feeding into global inflation. These are circumstances that we have inherited, and we will be prepared to take the advice of the ACCC, the regulatory body, but also of our departments for any further action that can be taken."
Mr Albanese said any power bill relief or any other form of cash handout in the budget would not be in the "national interest".
"It would have been counterproductive. It would have given a sweetener there. But we're determined to govern in the national interest," the Prime Minister told Channel 10.
"That's why we targeted our cost-of-living relief in areas that wouldn't feed into inflation.
"Cheaper childcare, cheaper medicine, more paid parental leave, more affordable housing, our plan to get wages moving, as well as structural investments in the National Broadband Network, in infrastructure investment in rail and road projects."